South African photovoltaic solar power market in position to promote local manufacturing growth

South African photovoltaic solar power market in position to promote local manufacturing growth PV Insider examines the potential of South Africa's photovoltaic solar energy market to drive local industry development and job creation in future rounds of the IRP. Many point to the positive policy environment that has driven the Chinese market, which has included high government subsidies for manufacturers to reduce financial risks, as an example that more action is needed in South Africa. Although local content levels have increased in round II, the true manufacturing output remains low, and if foreign manufacturers are to see the benefit of opening plants in this region financial reassurance and market longevity must be proven. 04 GW in this emerging solar PV market. Consequently, developers are continuing to import the majority of their components from cheaper suppliers in Europe and Asia, as modules and inverters are not yet manufactured on a large-scale in South Africa. To date the true manufacturing potential in South Africa remains minimal, with 2 active players who export the vast majority of their product to Europe. However, despite this substantial growth many experts have raised concerns over the South African government's aims to boost industrial development, economic growth, and employment creation within the IRP. Yet the ability to successfully unlock the strong opportunities for local manufacture and compete with established markets in the United States, China and Europe remains unclear. In the initial stages of the IRP the government highlighted the importance of the local content requirement, setting out specific prescripts for project developers. What's more experts think that the ability to export to neighboring countries in Africa and elsewhere could be a key driver to increase local content potential. Developers such as solar Reserve, Mainstream Renewable Power, Momentous Energy and Gestamp Solar will detail their experiences in procuring components in phase I, and how a local supply chain could benefit projects in years to come. Whilst Tenesol, who have recently strategically merged with SunPower, have a production capacity of 800,000 solar panels a year, at two plants, one in Toulouse, France, and the other in Cape Town. However, with local content defined as the total costs attributed to projects, this figure isn't restricted to key plant components, but also a wide selection of products and services needed when developing large-scale plants. This has taken the total pipeline to 27 PV projects in window I and II, totaling a staggering 1. 1 MW of new build generation capacity. At the heart of South Africa's manufacturing challenges, lays the need for developers to see the cost benefit of procuring components locally as compared to abroad. Experts have continued to argue that support for manufacturing must be pushed further to create and retain as much benefit to the country as possible and develop local manufacturing opportunities. South African photovoltaic solar power market in position to promote local manufacturing growth Trade News selected by Local Linkup on 04/06/2012